20 June 2012

After the Beecroft brouhaha

The pace of change never gets any slower in employment law, and we have quite a few consultations and proposals to report. It remains to be seen how many of them will become law, and in what form, but after a couple of well publicised retreats over the budget, and the leaking of the Beecroft Report in advance of its release in slightly different terms, perhaps a considered and thoughtful approach will be taken to them.

Consultations under way include:

• abolition of the procedure whereby employees who consider they may have been subjected to unlawful discrimination can send their employers a questionnaire to ask why they have been treated unfavourably. Expect an upsurge in Data Protection Act subject access requests, and possibly speculative cases, if this goes through. 
• repealing the provision which can make employers liable for harassment of its staff by third parties, such as customers, if they are aware of the harassment and fail to take reasonable steps to prevent it recurring. This was introduced following a series of cases where third party harassment was considered, including the notorious "Bernard Manning" case. One of the reasons cited for the repeal is that there is no call for it, and in certain circles (ahem) there seems to be some confusion between this provision and the liability of employers for harassment by their own employees.
• Cutting back on the power of tribunals to make more general recommendations to employers to stop discriminatory practices, where there has been a finding of discrimination against them.

The Enterprise and Regulatory Reform Bill sets out a range of far-reaching measures, a chunk of which relate to employment law and more specifically tribunal claims:

• Introducing compulsory requirement to submit a claim to ACAS for conciliation before lodging an unfair dismissal claim. This, might have some merit, although it has a whiff of the disastrous and counterproductive 2004 discipline and dismissal regulations about it, especially in Schedule 2 which provides for time extensions for bringing claims to allow for the conciliation period. What worries us is whether ACAS will have the resources to conciliate effectively. Many if not most employment lawyers have great regard for the services ACAS conciliators provide, if only you can get hold of one. 
• Providing a power to change the cap on unfair dismissal compensatory awards. Rather than the current standard cap for all shapes & sizes of employers, it seems that different caps may be applied to different types of employers. Possible caps could be a years' pay (actual pay, or pay subject to the cap on earnings used in calculation redundancy payments - it's not clear which yet, but the latter seems likely) , or between 1 and 3 year's median earnings, or the lesser of those. 
• Bringing in a power to impose a penalty (paid to the Treasury, not to the employee) of between £100 and £5,000 if there are "aggravating factors" in the case. No hint as to what those aggravating factors might be yet. Plenty of scope for litigation there, is our thinking. 
• As expected, providing that appeals from Employment Tribunal decisions are to be heard by a single judge in most cases, rather than a panel a judge and two lay members, and introducing a new "legal officer" role. The duties of the latter are not set out, but educated guesses are being made that they will deal with the new "rapid resolution" cases.
• The whistle-blowing provisions of the Employment Rights Act are to be changed in an endeavour to prevent the rules being used in disputes about individual contractual terms, by adding a requirement that the employee reasonably believes the disclosure to be in the public interest. But they would think that, wouldn't they? 
• Oh, and compromise agreements are to be re-named "settlement agreements". While the new name makes better sense to non-lawyers, it seems a bit of a missed opportunity to make them easier (quicker, cheaper) to draft.